If you have owned a rental property, you have probably experienced a bad tenant.
As a landlord or investor, you want a tenant who will treat your house with care and as their own. This means that while they’re living in it, it is their home. Despite this we all know there are many kinds of landlord and tenant problems; a nightmare tenant is one of the worst problems you can have.
If you notice any of the following signs, you may have a bad tenant.
Most of you are probably thinking, “I hope I never get a maintenance call from my tenants!” However, if you don’t hear at all from your tenant, it could possibly mean that they’re hiding something bad enough that they don’t want you to stopover. It could be a messy house or some damage due to negligence. You don’t want a small water leak to go unrepaired for so long that it becomes a much bigger and costlier job.
We give our owners the option to sign up for quarterly property inspections. We enter the home, take pictures, and send a report back to the owner. If our inspection turns up anything that we believe an owner should be concerned about, we let them know.
Unfortunately, you will not always find a tenant who will have the same cleanliness and sanitation practices as you. And if your tenant happens to be one of those people who’s not too keen on cutting the grass regularly/when needed or throwing out the garbage properly, you could have a problem. You will probably receive a nice notice from the city concerning your property.
If something catches the attention of the city and prompts them to send you a notice, you better believe the entire neighborhood is not happy about the condition of your property. Picture stacks of garbage that have been kept in the back too long; there would be plenty of rodents, roaches, and other creepy creatures, and not to mention the stink, that will have to be dealt with to make sure the property is sanitary again.
If you lived in your house before you started to rent it out, then you are most likely well acquainted with your neighbors. And if you have a good relationship with your neighbors, they will feel obligated to let you know about anything strange going on at your house. They will especially let you know if it’s something that disturbed their “peace and quiet.” And they should!
Wouldn’t you want to know if many different cars are parked on your lawn? Or if there are frequent parties that last into the wee hours of the evening? Or loud pets that are keeping the neighborhood up all night. Remember that your tenants are an extension of you, and they are your responsibility.
You may not think that this is a big deal, but a tenant who is not able to maintain their utilities could end up costing you thousands of dollars. If they don’t pay the power bill, the power company may possibly red tag the meter. If this happens, you will receive a visit from the electrical inspector before they agree to turn the power back on at your house. If they believe your home needs an electrical upgrade, that tenant’s $400 power bill may suddenly cost you thousands of dollars.
If the gas has been turned off, your tenant may start using space heaters which can short outlets and cause a fire. That’s a liability you don’t want in your life! If the equipment supplied by any of the utility companies is not used for an extended period, it’s highly likely that it will break down sooner or later. Remember, if it’s not running, it’s rusting — and rusting causes damage.
This is a classic move that a nightmare tenant loves to pull. First, they stop paying rent; and then everything in the house starts “falling apart.” Most of the time, they are looking for reasons to blame you for their nonpayment of rent.
Before they stopped paying rent, you didn’t hear any complaints; now, every crack in the wall and squeak on the floor is an issue. Pay close attention to these tenants because they are more than likely going to bail out when their balance becomes too high for them to pay. When they abandon your home, they may even leave it wide open. This usually happens once the eviction process has been started.
This can be a problem in more ways than one. If you visit your rental house (on multiple occasions) and the person answering the door is not who you leased your house to, it could mean that a) they have additional people living in the home who is not on the lease, or b) they are subletting your house. This can be a potentially big problem when they stop paying rent and you attempt to evict them — you don’t know the people you are evicting. This can make it harder to legally remove the squatters and get your house back on the market in a timely manner.
Everyone has bad days; this is true for both your tenants and you. But when you have a tenant that blatantly behaves in a disrespectful and abusive manner, you have a nightmare tenant. These kinds of tenants are looking to blame you, the landlord, for anything and everything. Every time you stop by to collect rent is a horrible experience; you dread every call because you already know to expect the worst.
Perhaps they look down on you, even if you own the place; or maybe they’re just obnoxious. Whatever the case, any person that treats you badly should not be living under your roof. If their attitude stinks, chances are your relationship will be the same.
This probably means that they’re hiding a bad tenant history. Again, make sure that the people you talk to are legitimate references. Do additional background checks on these references; it means more work, but it’s a step you might regret not taking when you end up with a nightmare tenant.
This could only mean that they can’t afford to pay their rent on time; and, worse, they will very likely bail out without paying their overdue rent and utility bills.
They may or may not have adequate income to pay rent, and they also have poor money habits.
This means that paying rent and utilities is not a priority for them.
As a landlord, there are best practices and proper precautions that will ensure you find the best tenant possible, one that will stay for a long time. Keep in mind that the longer the periods between turnovers, the better you will be financially and management-wise. This only happens if you have the ideal tenant.
When you have a long-term tenant — i.e., one that’s been renting for more than 5 years — all you’ll have to worry about is some regular maintenance and repairs. When a tenant moves out, on the other hand, you will be spending money on:
Remember, the higher the turnover rate, the higher your maintenance costs.
When you encounter a bad tenant you will want them to move out as soon as possible. Bad renters can be more than a nuisance and be a landlord’s worst nightmare. Perhaps they never pay on time and it’s always hard to get a hold of them when the rent is due, or your tenant may be downright abusive and even destructive.
Fortunately, there are ways for you to keep bad tenants out of your house. Let’s take a closer look.
You may believe that you’re a great judge of character, but the “best” bad renters have had plenty of practice fooling landlords; after all, they always have to find new places to move into.
Your first line of defense against bad tenants is a thorough screening process. It doesn’t matter if you’re in a hurry to turn over your property, or if you’re just too exhausted from showing your house to countless interested parties; you must not ease up on your screening process!
Here’s a guide to help you screen potential tenants based on four different criteria.
Make sure they have the right amount of income to adequately cover their rent and other associated expenses, such as utilities. And take the necessary steps to verify that their stated income is really what it is.
To be on the safe side, your potential tenant should be earning at least three times more than the rent per month.
For example, if your rent is $1,000, the tenants should be making at least $3,000 per month.
Some people may ask, “Well, is that gross or net?” Whichever is better is up to you, but the gross income amount is usually a perfectly fine threshold for income screening.
The second criterion is tenant references. Just like somebody who is applying to work for you, a potential tenant should also be able to provide verifiable references.
More often than not, your potential tenant had previously rented other houses; ask for the names of their former landlords and/or property management companies. You’ll be calling and asking them questions like, “If you could rent to this tenant again, would you? Why or why not?”
Do your due diligence to make sure the landlord/company you’re calling is legitimate. There should be a record of the landlord somewhere, such as through their rental property listing; a property management company should be listed as a legitimate business. Keep in mind that references from friends or family are not acceptable.
You may also want to check your potential tenant’s social media profile/s to get a sense of their personality and other relevant behaviors and traits that might tell you whether or not they’re trustworthy.
Doing a background check is a crucial step in your screening process.
Look for the following when doing a background check.
It’s extremely important that you check these three items off your list. Even if the potential tenant tells you a convincing and pitiful story, don’t let them sway you into overlooking a record of a misdemeanor, and especially a violent criminal offense. However, if their (legitimate) references provide positive feedback, it might be okay to reconsider and give them the benefit of the doubt.
But it’s important that you remain objective, not only for your peace of mind but also for your safety and the protection of your property.
This fourth point is also very important.
It’s common for a potential tenant to say, “Hey, listen, I went through a really hard time, didn’t have any money, lost my job.” This is totally understandable, especially during these times.
And these things can happen to anyone and, as a result, they would also say, “I was evicted out of my house when I lost my job. I couldn’t pay rent. But that was five years ago, I’m back on my feet. I got good tenant references, and I have a good income.”
If you’re satisfied with the results of the first three screening criteria, you may consider giving them a pass on their previous eviction. But keep in mind that you’ll be taking a risk, and your good intentions may end up blowing up in your face. Again, remain objective. The best way to keep bad tenants out of your house is to strictly follow these four screening criteria.
At Evernest, we take our screening criteria very seriously and make manage properties based on our owner’s best interests.
Since 2008, our team has remained dedicated to providing investors & owners with the best in-house rental property services around. Having placed thousands of tenants in many different markets, we know how important it is for you to have a team you trust.
With our in-house tenant screening process, we don’t take any unnecessary risks that might compromise your interests as a property owner. If you’re looking for a solid property manager to handle your tenant screening and placing process, let’s talk.
Fill out this form here, we’d love to see how we can help.
Whether you are an investment property owner, someone trying to sell your house, or looking to grow your portfolio, we have the information you need. Check out the Evernest YouTube channel today to learn the ins and outs of buying and managing your rental property.
Lucas is a Content Strategist for Evernest. You can find Lucas drinking coffee or eating tacos when he isn’t doing research or creating content. Lucas is a North Dakotan living in Austin, TX, with his wife and daughter.